Getting your finances right as a business owner is crucial. However, juggling a business and staying on top of your bookkeeping isn\u2019t an easy task. Investing in a qualified bookkeeper can help you grow your business without worrying about filing taxes or getting your employees paid.<\/p>\n
A bookkeeper\u2019s salary depends on their experience level, company size, local market, among other factors.<\/p>\n
In this detailed guide, we explore the available bookkeeping options. We also answer the question of how much a bookkeeper costs in Canada.<\/p>\n
Although bookkeeping is an integral part of a small and medium enterprise, most businesses fail to maintain their records and books. Unfortunately, that could lead to losses, frustration, and problems with the government when you fail to file your taxes correctly.<\/p>\n
Here\u2019s why bookkeeping is essential.<\/p>\n
Booking makes budgeting more manageable as you can review your financial costs and resources when your expenses and income are organized. With updated and accurate cash flow statements, income statements, balance sheets, and more, you can plan for the businesses\u2019 growth and have a clear roadmap for your businesses\u2019 future.<\/p>\n
Disorganized records not only exposes you to errors and missed deadlines, but it could also contribute to stress. On the other hand, getting your books organized gives you extra peace of mind, allowing you to focus on other essential aspects of your business.<\/p>\n
Having a bookkeeping process also prepares you for the tax season. You can confidently file taxes and defend yourself in case of a business audit.<\/p>\n
Additionally, bookkeeping makes it easy to attract investors and allows you to make better decisions regarding your business.<\/p>\n
As an entrepreneur, cutting down your costs is your number one priority. DIY bookkeeping<\/a> is convenient and affordable, but it may expose you to certain risks if you lack bookkeeping knowledge and time to track your records accurately.<\/p>\n Here are some disadvantages of DIY bookkeeping you should have in mind.<\/p>\n Being a business owner means handling sales, marketing, finances, and any other duty about your business. You may not have enough time to update the books, leading to mistakes in the payroll, late filing of invoices, or lacking receipts to support the information provided.<\/p>\n These irregularities could hamper your business growth and cause problems with the taxman, making you vulnerable to penalties and audits.<\/p>\n Bookkeeping is a time-consuming process. You may end up spending a lot of time updating your financial records and neglecting other areas of your business. However, time is critical, and it should be spent growing your business and not having to deal with something you can easily outsource.<\/p>\n Bookkeepers and accountants have the skills and training required to keep your financial records updated. However, if you lack basic bookkeeping skills and lack information on the latest tax updates, you may end up making costly errors that could be disastrous in the long run.<\/p>\n Hiring a bookkeeper, whether on a full-time or part-time basis, can save you money in the following ways.<\/p>\n Tax season can be stressful for any business owner in Canada. However, you can expect timely and accurate reporting of your expenses, budgets, salaries, and more with a qualified bookkeeper.<\/p>\n With this, you can track everything, file taxes correctly, and avoid penalties or fines. What\u2019s more, you can take advantage of tax deductions once you have updated records.<\/p>\n A bookkeeper handles data entry, records daily transactions, monitors accounts payable, among other responsibilities. In addition, hiring a bookkeeper reduces the amount of work an accountant has to handle when preparing tax returns, which further reduces your costs.<\/p>\n Running a business full-time can be exhausting. There\u2019s a need to keep track of your sales, have meetings with the marketing department, get your financial records updated, and much more.<\/p>\n Hiring a bookkeeper reduces the amount of work required, which allows you to scale and accommodate other business goals.<\/p>\n Businesses have varying needs, which means some will need less support, while other upcoming ones require more handholding.<\/p>\n There are two fundamental types of bookkeeping \u2014 basic bookkeeping, and full-service bookkeeping. You need to choose one depending on your bookkeeping needs and budget.<\/p>\n Basic bookkeeping involves payroll processing, accounts payable\/receivable, financial compliance, and recording transactions.<\/p>\n Any upcoming business needs to start with basic bookkeeping to ensure they comply with relevant state laws, file any transactions, and update their accounts payable\/receivable. You can then proceed to full-service bookkeeping to better manage your business\u2019 finances.<\/p>\n Full-service bookkeeping goes beyond the basics like maintaining business ledgers or recording financial transactions. It involves handling complex transactions, preparing financial statements, analyzing financial status, performing financial audit defense, among other responsibilities.<\/p>\n Businesses that have been in operation for several years, have hundreds of employees, and handle large financial transactions will most likely need a full-service bookkeeping system to manage their operations efficiently.<\/p>\n Expertise, the type of business you run, location, and time commitment are factors that will determine the cost of hiring an in-house bookkeeper.<\/p>\n Working with an in-house bookkeeper also involves other costs like bonuses, health benefits, paid vacations, and other typical employment benefits.<\/p>\n According to Talent.com<\/a>, an in-house bookkeeper in Canada earns an average salary of $49,789 annually, about $25-$26 an hour. The most experienced bookkeepers earn up to $60,000 a year.<\/p>\n If you\u2019re a small business owner looking for an affordable accounting solution, you can opt to hire a part-time bookkeeper.<\/p>\n Part-time bookkeepers can work on a contractual basis or choose to charge an hourly fee.<\/p>\n A part-time bookkeeper rate is about $20-$50 per hour, with an average salary of $41,925 per year.<\/p>\n Provinces like British Columbia have an average salary of $48,750.<\/p>\n Hiring an external bookkeeping service is an excellent option if your business lacks the resources to get full-time bookkeeping services.<\/p>\n As a business owner, you may have concerns about outsourcing, but with advancements in technology, outsourcing is becoming one of the affordable bookkeeping options compared to an in-house bookkeeper.<\/p>\n Hiring a bookkeeping service could cost you an average of $500. However, this figure could go higher depending on the complexity of services and the number of transactions required.<\/p>\n Running a financially compliant business gives you peace of mind and sends a message to your customers that they are working with a financially accountable and responsible company.<\/p>\n Businesses have varying needs, and it\u2019s crucial to decide the type of bookkeeping service you need and how much you\u2019re willing to spend before hiring any bookkeeping service.<\/p>\n\n
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3 Ways a Bookkeeper Can Save You Money<\/h2>\n
Saving Money on Your Taxes<\/h3>\n
Saving Money on Accounting<\/h3>\n
Save Your Business From Your Burnout<\/h3>\n
Types of Bookkeeping<\/h2>\n
Basic Bookkeeping<\/h3>\n
Full-Service Bookkeeping<\/h3>\n
In-House Bookkeeping<\/h2>\n
How Much Does it Cost to Hire an In-House Bookkeeper?<\/h3>\n
Pros of Hiring a Full-Time In-House Bookkeeper<\/h3>\n
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Cons of Hiring a Full-Time In-House Bookkeeper<\/h3>\n
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Part-time Bookkeeping<\/h2>\n
How Much Does it Cost to Hire a Part-Time Bookkeeper?<\/h3>\n
Pros of Hiring a Part-Time Self-Employed Bookkeeper<\/h3>\n
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Cons of Hiring a Part-Time Self-Employed Bookkeeper<\/h3>\n
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Bookkeeping Services<\/h2>\n
How Much Does it Cost to Hire a Bookkeeping Service?<\/h3>\n
Pros of Hiring a Bookkeeping Service<\/h3>\n
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Cons of Hiring a Bookkeeping Service<\/h3>\n
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Takeaways For Hiring a Bookkeeper<\/h2>\n